Problem 12-9A Condensed financial data of Odgers Inc. follow. ODGERS INC. Compar
ID: 2475784 • Letter: P
Question
Problem 12-9A Condensed financial data of Odgers Inc. follow. ODGERS INC. Comparative Balance Sheets December 31 Assets 2014 2013 Cash $ 116,352 $ 69,696 Accounts receivable 126,432 54,720 Inventory 162,000 148,104 Prepaid expenses 40,896 37,440 Long-term investments 198,720 156,960 Plant assets 410,400 349,200 Accumulated depreciation (72,000 ) (74,880 ) Total $982,800 $741,240 Liabilities and Stockholders’ Equity Accounts payable $ 146,880 $ 96,912 Accrued expenses payable 23,760 30,240 Bonds payable 158,400 210,240 Common stock 316,800 252,000 Retained earnings 336,960 151,848 Total $982,800 $741,240 ODGERS INC. Income Statement Data For the Year Ended December 31, 2014 Sales revenue $559,382 Less: Cost of goods sold $195,062 Operating expenses, excluding depreciation 17,870 Depreciation expense 66,960 Income tax expense 39,283 Interest expense 6,811 Loss on disposal of plant assets 10,800 336,786 Net income $ 222,596 Additional information: 1. New plant assets costing $144,000 were purchased for cash during the year. 2. Old plant assets having an original cost of $82,800 and accumulated depreciation of $69,840 were sold for $2,160 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $37,484 was declared and paid during the year. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) ODGERS INC. Statement of Cash Flows For the Year Ended December 31, 2014 $ Adjustments to reconcile net income to $ $
Explanation / Answer
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES
NOTE- PLEASE CHECK YOUR BEGINNGING CASH. I THINK THERE IS A TYPING ERROR BEGINNING CASH SHOULD BE $116354
DESCRIPTION AMOUNT $ AMOUNT $ NET INCOME 222596ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES
DEPRICIATION EXPENSES 66960 LOSS ON SALE OF PLANT 10800 INCERESE IN ACCOUNTS RECEIVABALE (71710) INCEREASE IN INVENTORY (13896) INCERESE IN PREPAID EXPENSES (3456) INCERESE IN ACCOUNTS PAYABALE 49968 DECEREASE IN ACCURED EXPENSES PAYABLE (6480) 32186 NET CASH PROVIDED BY OPERATING ACTIVITY 254782 CASH FLOW FROM INVESTING ACTIVITY SALE OF PLANT ASSETS 2160 PURCHASE OF PLANT ASSETS (144000) PURCHASE OF INVESTMENT (41760) NET CASH USED IN INVESTING ACTIVITY (183600) CASH FLOW FROM FINANCING ACTIVITY SALE OF COMMON STOCK 64800 PAYMENT OF CASH DIVIDEND (37484) REDUMPTION OF BOND (51840) NET CASH USED IN FINANCING ACTIVITY (24524) NET INCEREASE IN CASH 46658 CASH AT BEGINNING 69696 CASH AT END OF PERIOD 116354